Nightly News   |  January 28, 2014

Lavish Spending Leaves Royal Finances in Shambles

A new report from a committee in the British House of Commons had some harsh things to say about life inside the royal palace.

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This content comes from Closed Captioning that was broadcast along with this program.

>>> we mentioned this before the break, an unusual story popped up across the atlantic in the u.k. today. it's about something we never really assumed to be a big issue for the queen and her royal household , and that's money. nbc's kate snow has more on the story tonight.

>> reporter: oh, to be the queen. the jewels, the parties, the lavish lifestyle, the british people spent more than $50 million last year to keep up that image. this new report from a committee of the british parliament says the royal household finances are in shambles, the queen has not been served well by her staff when it comes to managing the books, sticking to a budget or even keeping up buckingham palace .

>> for example, the boyer at buckingham palace is 60 years old, it's out of date. the electricity and gas bills are huge. it should be replaced, there's no money for it.

>> reporter: approximately 40% of the queen's properties are in unacceptable condition. buckets sit under leaky roofs in a gallery containing priceless art. no one seems to know exactly what needs to be fixed.

>> when we ask the royal household of the assessment of how much money they spent, theyen cot tell us.

>> reporter: hodges committee says her royal household has been spending beyond its means, given that grant of $51 million last year, they overspent by about $4 million. draining down their rainy day fund to a historically low level. what's a queen to do? parliament suggests laying off some staff, while government agencies have been pinching pennies, the royal household has barely changed in size, with more than 430 people on the payroll for the past seven years. and here's the big one, the committee wants the queen to open her doors to tourists for more than just a couple months in the summer.

>> possibly rent out buckingham palace to extend the time it's open to the general public . that is a possibility.

>> reporter: in a statement, the queen's spokesman said they're working on a backlog of repairs. and the royal household is already generating more income than it did five years ago. lawmakers call that good news, those who serve the queen can do better. kate snow , nbc